Blowout Galas

They raise lots of cash for MoMA and Multiple
Sclerosis—but at what price? A cost-vs.-revenue analysis.

Even nonprofits have to spend money to make money, but how much is too much when it comes to throwing a benefit?

“You want to have a beautiful gala—that’s how you build your donor base,” says Toni Goodale, of the fund-raising and consulting firm Goodale Associates. And securing the best caterers, venues, and entertainment adds up. The Princess Grace Foundation USA, for example, raised more than $1 million at its lavish gala at the Waldorf-Astoria in 2003. But the party cost more than $700,000, or 66 percent of its revenue. “The event is extremely elegant,” insists development director Theresa Dorey. “I don’t think the foundation is willing to step back on that level of production.”

Although there is no legal limit on how much a charity event can cost, Goodale recommends that nonprofits keep their expenses at less than 30 percent of the event’s revenue. We analyzed charities’ most recent available tax returns to see how a few upcoming benefits measure up.

3/10:
Museum of Modern Art’s “Armory Show” preview party at Chelsea Piers. What: Cocktails, hors d’oeuvres, and
the first chance
to buy art from the show.
Tickets: $1,000 for the first look, at 5 p.m.
Cost vs. Revenue:74 percent.
The 2003 event
cost $169,000
and raised $228,000.